Apple shares fell about 4% in premarket trading on Tuesday, November 3, after the tech giant warned that rising memory costs would squeeze gross margins, stoking investor concerns over persistent supply-chain uncertainties and mounting AI expenses.
\n\nJohn Ternus delivered his first earnings report as Apple CEO on Monday, describing the memory-pricing environment as ”unprecedented” while expecting costs to rise beyond the quarter ending in December.
\n\nThe iPhone maker has benefited from using memory purchased at lower prices, but that advantage is expected to diminish over time, leaving more of its purchases exposed to higher prices.
\n\nAlso read: Neuland Laboratories Q2: Profit falls 47%, revenue declines 12.5%; margins contract
\n\nGross margins, which measure the percentage of revenue retained after the costs of making its products, were 47.9% for the September quarter, down from June-quarter levels even when factoring in the impact of tariff refunds.
\n\nApple expects gross margin for the December-ending quarter to range between 45% and 46%, which also reflects the expenses tied to the ramp-up of its AI-powered Siri.
\n\nThe CEO comments imply ”Apple products are going to become even more expensive, which is not ideal at a time when the consumer is feeling the pinch from a higher…
Original source: https://www.cnbctv18.com/technology/
